Hello again. Welcome to our Pro Masterclass on getting started with limited companies for property investment. If you're thinking about investing in a buy to let property for the first time or perhaps want to turn a property you've inherited into a buy to let, then you've probably been researching the best options for making your time and effort worthwhile. In my experience, it's in this early research phase that prospective investors hear about using limited companies for their property business. It's become a popular way to manage investments tax efficiently and make the money you invest work hard. What does using a limited company mean, and is it the right choice for you? That's what we're going to explore in this first lesson. Let's start by understanding what a limited company is and how it differs from owning property personally. When you purchase a buy to let personally, you own that property outright. It's yours and any income or debt associated with it is directly tied to you. But with a limited company, the company buys and owns the property and you don't own the property directly. Instead, you own the company via your shares and the company owns the property. This distinction is crucial because it means the company is responsible for the taxes, debts and liabilities associated with the property. One of the biggest advantages of using a limited company for property investment is this separation. Since the company is a separate legal entity, your personal assets like your home or savings are largely protected if something goes wrong with your investment. The limited liability is a reassuring benefit, especially if you're planning to build and grow your portfolio over time. But protection isn't the only reason limited companies have become popular, they also offer significant tax advantages. Limited companies pay corporation tax on their profits, which is generally lower than the higher rate of income tax that individual landlords who don't use a limited company would pay. For example, if you're a higher rate taxpayer you could be paying forty percent or more in income tax on your rental profits. In contrast, corporation tax is currently around nineteen percent which can result in substantial savings. Another major tax advantage is that limited companies can claim back one hundred percent of mortgage interest as an expense, meaning your tax bill is reduced. This is something that individual landlords can no longer do in full, making the limited company route even more attractive for property investors. Finally, the most powerful benefit of using a limited company is the flexibility it offers. With a limited company, you have the option to structure it in a way that aligns with your personal and financial goals, whether you're saving for your children's university fees, planning to pass on an inheritance to your grandchildren or simply looking to grow your wealth or passive income, a limited company gives you the tools to do that. For example, you can include family members in the company, which is a great way to involve them in the business and distribute income more tax efficiently. You can also bring in business partners if you're looking to collaborate on your investments. When it comes to profits, the flexibility is even greater. Unlike personally owned properties where all profit is classed as income and taxed as such, a limited company allows you to keep the profits within the company. This means you can reinvest those profits into more properties, build a nest egg for early retirement, invest in a pension or draw down on them as dividends when it suits you. You can even employ people, including family members, to help run your portfolio, which can be a productive and tax efficient way to manage your business. Now you might be wondering if limited companies are only suitable for those with large portfolios. In the past, that might have been the case, but things have changed. Limited companies are now so affordable to set up and run that even small investors are taking advantage of them. In fact, around eight out of ten buy to let properties are now purchased via limited companies and at Provestor we've made it easier than ever to manage a limited company, even if you're just starting out with one or two properties. Our low cost, low effort accountancy service is specifically designed for small portfolios, so you can benefit from the advantages of a limited company without being bogged down by admin or high costs. Of course, running a limited company does come with responsibilities. You'll need to have something in place for handling your accounts and tax returns and that's where services like ours come in. You can ensure everything is taken care of with minimal efforts on your part and it doesn't need to be expensive either. With Provestor those costs are lower than ever, making the advantage of running a limited company accessible to everyone. So is a limited company right for you? For most people, especially higher rate taxpayers looking to take out a buy to let mortgage or those looking to grow a portfolio over time, the answer is likely yes. The tax efficiencies, protections and flexibility offered by a limited company can make a significant difference in your investment strategy. However, if you're a basic rate taxpayer and only looking to buy a single property, a limited company might not be the best fit for you. In this case the simplicity of owning the property personally could outweigh the benefits of setting up a company. And remember, these are broad rules of thumb. Deciding on whether a limited company is right for you is ultimately done on a case by case basis because everyone has different goals. You might have bold plans to become a full time investor and landlord and change your lifestyle completely. Or you could have a more modest plan and only ever want to manage a couple of properties to supplement your current income or save for retirement. How you decide to set up a company is therefore unique to your situation and your future plans. This masterclass will help you understand more about your options and determine the right path. If you want to be sure about your limited company options or just need more confidence in your decision, here at Provestor we offer one to one tax consultations with qualified property tax advisers who can talk through your options and offer personalised recommendations. So to sum up, we've covered what a limited company is and how it differs from personal ownership, the key benefits and downsides and how to determine if it's the right choice for your property investments and goals. This is just the beginning. Throughout this Pro Masterclass, we'll dive deeper into some of these topics as well as help you understand the whole process of buying a property using a limited company. Thanks for joining me and I'll see you in the next lesson.